ESG - Investing responsibly

At Berenberg, ESG investment strategies take into account Environmental (E), Social (S) and Governance (G) issues on top of traditional fundamental issues such as micro and macroeconomic information. “ESG investing”, in essence, is a term that is used synonymously with “ethical screening”, “sustainable and responsible investing” and even with “impact investing”.

Berenberg ESG Office

To define our ESG principles and strategy, to position ESG investments, to develop and increase the range of ESG products on offer and to integrate ESG into the investment process, we have set up a separate department, the Berenberg ESG Office.

Ethical screening

Many of our clients have their own range of specific ethical criteria through exclusions lists. We have developed strategies and resources to ensure that our investment process can be tailored to their pre-defined values or beliefs.

Sustainable and responsible investing

Companies are evaluated and screened based on their ESG risk and sustainability credentials with a particular emphasis on scrutinizing controversial business practices.

Impact investing

Selection of companies with the intention to generate returns alongside social and environmental impact.

ESG investing is also about understanding companies and countries from a sustainable investment perspective. By addressing ESG issues in our investment decisions, we support to create positive outcomes for the environment and society. The topics that are commonly considered in the E,S and G categories are:

Environmental

Climate change
Environmental pollution
Deforestation
Eco-friendly technologies
Greenhouse gas emissions

Social

Working conditions
Health and security
Fair trade products
Employee relations and diversity
Support local communities

Governance

Briberey and corruption
Compensation structure
Board diversity and structure
Cyber-security
Anti-competitive practices

ESG at Berenberg

We understand the value of integrating ESG factors into our investment decisions in order to better manage material ESG risk in our portfolios. We believe that engagement is very important and part and parcel of ESG integration. Our highly experienced portfolio managers actively engage with companies on ESG issues in order to understand company behaviour better, especially their potential growth drivers and to hopefully influence them on being better on sustainability topics. We also integrate ESG factors to ensure that our portfolios contain companies that are fully sustainable.

Berenberg is a signatory to the United Nations supported Principles for Responsible Investment (UNPRI) since August 2018.

ESG Consulting

We support you in specific ESG fields of action and provide you with comprehensive support regarding the implementation of your individual sustainable investment strategy. Our range of services includes assistance in the formulation of ESG policies and investment guidelines as well as regulatory issues. We also offer training on general and specific ESG content.

Berenberg ESG Investments

At Berenberg we have managed sustainable strategies for decades. We also offer various other ESG-integrated strategies in both quantitative and discretionary methods, across the asset classes in which we invest (equity and fixed income).

Our Berenberg Sustainable World Equities invests worldwide in companies that make a positive impact on the environment and society through their products and services, taking into account Berenberg ESG values. The selection of the companies is carried out "bottom-up", i.e. based on fundamental company data. Correspondingly, the companies should demonstrate above-average structural growth and be able to generate long-term sustainable earnings. In addition, the business model and key business metrics needs to be compelling. The focus is on detailed discussions with analysts and company representatives.

To funds overview

Our Berenberg Sustainable EM Bonds strategy aims to select particularly USD-denominated emerging market sovereign bonds under sustainability aspects and by means of an active, quantitative investment process. This systematic, transparent investment process enables an admixture of ESG-compliant companies from the emerging markets, in addition to a selection of sustainable states with strong fundamentals. The portfolio is under ongoing risk management through active control and if desired static hedging against currency risk vis-a-vis the euro.

To funds overview

The “Berenberg 1590 Stiftung” is a broadly diversified Multi Asset Fund, investing in various asset classes like bonds, equities (max. 25%) and alternative investments (max. 10%). In total, equity investments and alternative investments are limited to 30%. The fund is focused on foundation-specific aspects and Berenberg sustainability criteria, which are essential within the selection process. An active tactical asset allocation, duration and allocations by region and by sector are derived from macroeconomic, fundamental and technical indicators. The investment strategy is implemented via individual securities, investment funds and exchange-traded funds (ETFs) with a focus on Europe. Derivatives can be added for hedging purposes or to optimize returns. The share class is distributing, with distributions taking place on a semi-annual basis.

To funds overview